European stocks set to open lower as Iran war concerns grow

LONDON — European stocks are expected to open mostly lower on Tuesday as investors digest the latest developments in the Iran war.

The U.K.'s FTSE index is seen opening flat, Germany's DAX and France's CAC 40 down 0.4%, respectively, and Italy's FTSE MIB 0.1% lower, according to data from IG.

Global markets were shaken Monday as a fragile ceasefire between the U.S. and Iran appeared to be close to collapse as the United Arab Emirates came under attack from Iranian drones and missiles, and the U.S. said it sank Iranian boats in the Strait of Hormuz.

President Donald Trump, in a Fox News interview later Monday, warned Iran that it will be "blown off the face of the earth" if it targets U.S. ships that are protecting commercial vessels transiting the strait.

Trump also said in a Truth Social post that a South Korean cargo ship had come under fire from Iran in the waterway. "Perhaps it's time for South Korea to come and join the mission!" Trump wrote in the post.

Stock market indices closed sharply lower and oil prices rose Monday amid fears that the war could continue for much longer than expected, potentially causing a global recession. Oil prices declined overnight.

Earnings continue Tuesday with Anheuser-Busch InBev, Intesa Sanpaolo, Ferrari, Novonesis, Geberit, Banco BPM, Covestro and Fresenius Medical Care all due to report.

Earlier Tuesday, Europe's largest lender HSBC reported first-quarter pretax profit of $9.4 billion, marginally missing analysts' estimates.

— CNBC's Kevin Breuninger contributed to this market report.